SOC 2 Compliance
What is SOC 2 Compliance?
SOC 2 compliance is achieved through an audited American Institute of CPA's (AICPA) Service Organization Control (SOC) Report that certifies you protect client data with business process and technical controls that meet requisite standards. These SOC 2 standards are based on the AICPA's five Trust Services Criteria (TSC) for data - security, privacy, availability, processing integrity, and confidentiality.
Increasingly, a SOC 2 is required by large companies, financial institutions, and health care organizations to do business. It is the gold standard to ensure you are securing your data and mitigating risk. An audited SOC 2 report demonstrates your security and privacy excellence to the marketplace, builds trust, and speeds procurement with potential customers. Every modern company is now digital and will benefit from a SOC 2 to ensure proper information security.
SOC 1 vs. SOC 2
The difference between SOC 1 and SOC 2 is the scope of the controls, policies, and procedures tested.
A SOC 1 report focuses on financial controls to ensure proper handling of a client's financial information. A SOC 2 report focuses on non-financial controls for protecting data. If you process data that impacts your client's financial statements then a SOC 1 will be needed.
Type 1 vs. Type 2
The difference between Type 1 and Type 2 is design versus operating effectiveness.
A Type I tests design by looking at your description of controls at a particular point in time. A Type II tests operating effectiveness by collecting evidence of your controls in operation over a 6 to 12-month period. Start with a Type 1 then build to a Type 2, unless a specific client requires a Type 2 immediately.
When to get a SOC 2 certification?
Invest in compliance and a SOC 2 in preparation to move upmarket or into regulated industries like finance and healthcare.
Increased regulations, security threats, and data protection standards are pushing compliance requirements downstream. If it is not blocking a deal now, it will if you plan to grow. The longer you wait, the more complex, time consuming, and costly it will be. Technical and operational debt will accrue and complicate changing organizational behaviors. Invest now.
How to get a SOC 2 certification?
Obtaining a SOC 2 certification requires an investment and commitment of organizational resources and attention.
Certification preparation requires work to map existing controls to those required, perform a gap analysis, remediate deficiencies, document everything, and collect evidence. Then find, sign, and work with an auditor to execute the audit. It is an involved process with a timeline that depends on your commitment, thoroughness, and whether or not you engage service providers to help.